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DECISION No. 28/2004/QD-BTC OF MARCH 23, 2004 ON THE SECOND-DRIVE ISSUANCE OF GOVERNMENT BONDS IN 2004 FOR INVESTMENT IN SOME IMPORTANT TRAFFIC AND IRRIGATION WORKS OF THE COUNTRY

THE MINISTER OF FINANCE

Pursuant to the Government's Decree No. 77/2003/ND-CP of July 1, 2003 defining the functions, tasks, powers and organizational structure of the Ministry of Finance;

Pursuant to the Prime Minister's Decision No. 235/2003/QD-TTg of November 13, 2003 defining the functions, tasks, powers and organizational structure of the State Treasury under the Ministry of Finance;

Pursuant to the Government's Decree No. 141/2003/ND-CP of November 20, 2003 on the issuance of Government bonds, Government-underwritten bonds and local-administration bonds;

Pursuant to the Prime Minister's Decision No. 182/2003/QD-TTg of September 5, 2003 on the issuance of Government bonds for investment in some important traffic and irrigation works of the country;

At the proposal of the general director of the State Treasury,

DECIDES:

Article 1.- To issue the Government bonds in the second drive of 2004 with the total amount of Vietnam dong (VND) 8,200 billion and US dollar (USD) 50 million for investment in the construction of some important traffic and irrigation works of the country.

Article 2.- Government bonds (hereinafter called bonds for short) shall be issued and paid in Vietnam dong and US dollar, and in form of certificates or book entries.

Vietnam-dong bond certificates include registered and bearer ones, pre-printed with different denominations of VND 100,000, VND 200,000, VND 500,000, VND 1,000,000, VND 2,000,000, VND 5,000,000, VND 10,000,000, VND 20,000,000, VND 50,000,000 and VND 100,000,000.

US-dollar bond certificates include registered and bearer ones, pre-printed with different denominations of USD 500, USD 1,000, USD 5,000 and USD 10,000.

Article 3.- Modes of bond issuance

3.1. Issuance through the system of State Treasuries:

Vietnam dong bonds shall be issued at the State Treasury units nationwide.

US dollar bonds shall be issued at Hanoi State Treasury, Ho Chi Minh City State Treasury, Hai Phong State Treasury, Quang Ninh State Treasury, Da Nang State Treasury and Ba Ria – Vung Tau State Treasury.

a/ Bond buyers shall include Vietnamese organizations and citizens; overseas Vietnamese; foreigners working and/or residing in Vietnam; and foreign organizations operating in the Vietnamese territory, except for those being bond-underwriting and -bidding members (including Vietnam-dong bond bidding through the Securities Trading Centers and US-dollar bond bidding through the State Bank's Transaction Office).

Vietnamese organizations must not use funding allocated from the State budget to purchase bonds.

b/ Bond term: 5 years.

c/ Bond interest rate shall be decided by the Finance Minister at the time of issuance.

d/ Issuance duration: Beginning from April 15, 2004 and ending before June 15, 2004.

3.2. Vietnam-dong bond bidding through Securities Trading Centers:

a/ Subjects eligible to participate in the bond bidding are members of the market for bond bidding through the Securities Trading Centers. Organizations and individuals wishing to purchase bonds through bidding shall register with members of the bond-bidding market and organizations licensed to trade at securities market.

b/ Bond terms: 5 years and 10 years.

c/ Bond interest rates shall be formed through the bidding results.

d/ Issuance duration: Beginning from April 15, 2004 and ending before December 15, 2004.

3.3. US-dollar bond bidding through the State Bank:

a/ Subjects eligible to participate in bond bidding are Vietnam-based credit institutions, licensed to trade in foreign exchange and have foreign-currency accounts opened at the State Bank.

b/ Bond terms: 5 years and 10 years.

c/ Bond interest rates shall be formed through the bidding results.

d/ Issuance duration: Beginning from April 15, 2004 and ending before December 15, 2004.

3.4. Vietnam-dong bond issuance underwriting:

a/ Subjects eligible to participate in bond issuance underwriting are organizations permitted to underwrite bond issuance according to the current regulations.

b/ Bond terms: 5 years and 10 years.

c/ Bond interest rates and issuance underwriting charges shall be agreed upon between the issuance-underwriting organizations and the State Treasuries according to the current prescribed regimes.

d/ Issuance duration: Beginning from April 15, 2004 and ending before December 15, 2004.

Article 4.- Principles and modes for payment of bond principals and interests:

4.1. Bonds shall be paid in the currency in which they are issued.

4.2. Vietnam dong bonds:

- Bearer ones, pre-printed with denominations and issued through the State Treasuries, shall be paid at State Treasury units nationwide.

- Registered ones, pre-printed with denominations and issued through the provincial/municipal State Treasuries, shall be paid at the State Treasuries where they are issued.

- Bonds opened to bidding through the Securities Trading Centers and underwritten upon issuance, and listed at the Securities Trading Centers shall be paid by the Securities Trading Centers in coordination with the State Treasuries.

4.3. US dollar bonds:

- Those which are issued through Hanoi State Treasury, Ho Chi Minh City State Treasury, Hai Phong State Treasury, Quang Ninh State Treasury, Da Nang State Treasury, and Ba Ria - Vung Tau State Treasury (including registered and bearer ones, pre-printed with denominations) shall be paid at the State Treasuries where they are issued.

- For those opened to bidding through the State Bank: The State Bank's Transaction Office shall act as an agent for the Finance Ministry in making payment for bonds upon their maturity.

4.4. Payment of bond principals: Bond principals shall be paid in lump sums upon their maturity.

In cases where bond owners are individuals that meet with special difficulties or force majeure circumstances and wish to get premature payment for bonds, they must obtain certification by administra-tions of the localities where they reside or agencies where they work; the general director of the State Treasury shall consider and submit such to the Finance Minister for permission for premature re-purchase. For bonds which are immature for interest enjoyment, interests thereon shall not be paid.

4.5. Bond interest payment: Bond interests shall be paid once a year when bonds are full 12 months, counting from the date of purchase.

If upon the maturity for payment of bond principals or interests, the bond owners do not come to get the payment, such principals or interests shall be reserved for refund to the bond owners when they need to get the payment; interest shall not be added to the principals and shall not be paid for the over-mature period.

Article 5.- Bond owners shall enjoy the following rights and preferences:

5.1. To be entitled to transfer, donate, bequeath or use their bonds for pledges in credit relations.

5.2. To be entitled to purchase, sell and trade in bonds listed at the Securities Trading Centers through the Securities Trading Centers.

5.3. Bond owners being credit institutions shall be entitled to trade in bonds on the monetary market; discount and rediscount bonds according to the State Bank's regulations.

5.4. Bond owners being individuals shall be exempt from personal income tax for their incomes from bond interests and bond purchase/sale price differences; and may deposit their bonds at the State Treasuries for free-of-charge custody if they so wish.

Article 6.- The general director of the State Treasury shall have to:

6.1. Organize the bond issuance and payment according to the provisions of Articles 3 and 4 of this Decision.

6.2. Take initiative in administering the volume, term and interest rate of bonds issued by bidding or underwriting modes prescribed at Points 3.2, 3.3 and 3.4, Article 3 of this Decision within the volume limit, term and interest rate bracket approved by the Finance Minister and in accordance with capital use demands.

6.3. Account, report on, and settle, bond revenues and payments according to the prescribed regimes.

Article 7.- This Decision takes effect 15 days after its publication in the Official Gazette.

The general director of the State Treasury shall guide in detail and direct the implementation within the whole State Treasury system, the heads of the concerned units under the Finance Ministry, and the directors of the provincial/municipal Finance Services and State Treasuries shall have to implement this Decision.

Minister of Finance
NGUYEN SINH HUNG